KUALA LUMPUR (March 26): Hong Leong Investment Bank Bhd raised its Gamuda Bhd share target price (TP) to RM5.98 from RM5.95 and upped its earnings forecast for the builder. Hong Leong said Gamuda's first half earnings were within expectation.

Hong Leong analyst Jeremy Goh said this in a note today after Gamuda reported on Friday that net profit rose to RM414.27 million in the first half ended Jan 31, 2018 (1HFY18) from RM328.41 million a year earlier. Gamuda said revenue climbed to RM1.77 billion from RM1.36 billion.

Today, Goh said: "1H18 earnings accounted for 53% of our full year estimates (consensus: 52%) which is within expectations. Gamuda's earnings upcycle is poised to hit another round of multi-year highs in FY18 and FY19. Maintain Buy with a higher target price of RM5.98."

"FY18-20 earnings raised by less than 1% due to minor model up keeping adjustments," he said.

RHB Research Institute Sdn Bhd analyst Tay Yow Ken said in a note today RHB maintained its buy call for Gamuda shares based on a TP of RM5.80.

"Gamuda reported 1HFY18 (July) core net profit of RM409 million (+25% y-o-y), which met expectations, accounting for 51% of estimates," Tay said.

At Bursa Malaysia today, Gamuda shares settled at RM5.09 at 12:30pm with 386,000 shares traded.